U.S. employs Vinnie the Kneecapper to collect student debt…

On the heels of the assessment we saw from Tyler Durden, via Fitch, of the implosion of US student loan debt, which stands at over $1 trillion, increases by $40-50 billion (!!) each month (or $500-$600 billion per year), and of which 27% is already 30 days or more delinquent, John Hechinger explains for Bloomberg how the US Education Department goes about collecting this debt.

Turns out, it’s case of “Eat your heart out, Tony Soprano”. Hard to believe this could happen in a supposedly civilized country, but there you have it. Here are some excerpts from Hechinger’s article:

The debt collector on the other end of the phone gave Oswaldo Campos an ultimatum:

Pay $219 a month toward his more than $20,000 in defaulted student loans, or Pioneer Credit Recovery, a contractor with the U.S. Education Department, would confiscate his pay. Campos, disabled from liver disease, makes about $20,000 a year.

“We’re not playing here,” Campos recalled the collector telling him in December. “You’re dealing with the federal government. You have no other options.”

Campos agreed to have the money deducted each month from his bank account, even though federal student-loan rules would let him pay less and become eligible for a plan — approved by Congress and touted by President Barack Obama — requiring him to lay out about $50 a month. To satisfy Pioneer, Campos borrowed from friends, cut meat from his diet and stopped buying gas to drive his 82-year-old mother to doctor’s visits for her Parkinson’s Disease.

With $67 billion of student loans in default, the Education Department is turning to an army of private debt-collection companies to put the squeeze on borrowers. Working on commissions that totaled about $1 billion last year, these government contractors face growing complaints that they are violating federal laws by insisting on stiff payments, even when borrowers’ incomes make them eligible for leniency.

Education Department contracts — featuring commissions of as much as 20 percent of recoveries — encourage collectors to insist on high payments. Former debt collectors said they worked in a “boiler-room” environment, where they could earn bonuses of thousands of dollars a month, restaurant gift cards and even trips to foreign resorts if they collected enough from borrowers. [..]

Debt collectors are the subject of more complaints to the Federal Trade Commission than any other industry — almost 181,000 last year. Within the past 17 months, three companies working for the Education Department — including one that is majority owned by JPMorgan Chase & Co.’s private-equity arm — settled federal or state allegations of abusive debt collections. The companies didn’t acknowledge wrongdoing, and Chase declined to comment. The Education Department said the government investigations didn’t involve the companies’ work for the agency. [..]

Debt-collection companies helped the Education Department recover $11.3 billion in defaulted loans during the year ended Sept. 30. The agency projects it will collect 85 cents on every dollar that defaults, factoring in collection costs and the time-value of money.

The debt collectors made out well, too. Based on a review of government contracts and Education Department data, the private companies — working directly for the government and through state agencies — received commissions of about $1 billion in the year through September. [..]

“Student-loan debt collectors have power that would make a mobster envious,” Harvard Law Professor Elizabeth Warren, who helped establish the Consumer Financial Protection Bureau and is now running for a U.S. Senate seat from Massachusetts, said in 2005.

Under Education Department contracts, collection companies “rehabilitate” a defaulted loan by getting a borrower to make nine payments in 10 months. If they succeed, they reap a jackpot: a commission equal to as much as 16 percent of the entire loan amount, or $3,200 on a $20,000 loan.

These companies receive that fee only if borrowers make a minimum payment of 0.75 percent to 1.25 percent of the loan each month, depending on its size. For example, a $20,000 loan would require payments of about $200 a month. If the payment falls below that figure, the collector receives an administrative fee of $150.

Debt collectors are under pressure to extract as much money as they can up front, or lose their jobs, said J.C. Cournan, who worked for Pioneer Credit Recovery from 2004 through 2007.

Collectors, then paid about minimum wage, could earn thousands of dollars a month in bonuses, based on the money that borrowers repaid, said Cournan, who took the upstate New York job out of high school. Pioneer set monthly goals for wage garnishments and loan rehabilitations, he said.

Using automatic dialers to track down borrowers, Cournan would figure out where they worked, then contact their employers. He would tell borrowers that he was going to seize part of their wages if they didn’t make the payments. Using a company loan calculator, Cournan would insist on the minimum payment, he said.

“When you’re making 8 bucks an hour, it’s all about the bonuses. You’re starving,” said Cournan, 26, now an auto mechanic. [..]

The collection business is booming as defaults more than doubled since 2003, along with outstanding federal student loans, which totaled $848 billion as of Sept. 30, surpassing credit-card debt.

The U.S. loan program was born in 1965 as a “Great Society” initiative for lower-income students under President Lyndon Johnson. Today, with tuition soaring, two-thirds of college seniors graduate with loans, which average $25,000, according to the Institute for College Access & Success, an Oakland, California, nonprofit education and advocacy group.

Obama — supported by Congress — has pledged to give borrowers a break and make college more affordable.

In 2009, Congress expanded a program that lets lower-income students tie payments to their incomes. It’s a sliding scale, based on their debt, salaries and family obligations. Married borrowers with two children, $30,000 in income and $30,000 in student loans wouldn’t have to make any payments, according to a government loan calculator. If circumstances don’t improve, the loans can be canceled after 25 years.

Well, you get the picture by now. And if the US government gives the shining example by resorting to employing debt collectors with a mobster mentality, we can all imagine what sort of “services” other creditors may think wise to use.

It’s insanity to use this sort of thing against one’s own young generation, upon which the future of a nation depends. The fact that the $1 trillion total student loan debt is set to double at the current rate within 2 years, is a clear enough signal of how the US sees its own children. The Vinnie the Kneecapper fashion of collecting on the debt really only serves to clarify and amplify that picture.

And you may rest assured that it’s not just the young. As debt levels are rising, and defaults are exploding against the backdrop of much stricter bankruptcy laws, we will soon all know someone in our families or circle of friends who’s had a visit of Vinnie.

Maybe now people will start to understand why we have said so many times before that they need to get out of debt.
~~

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Happiness is the only good. The time to be happy is now. The place to be happy is here. The way to be happy is to make others so. ~Robert Ingersoll

All religion is a foolish answer to a foolish question. ~Thomas Shelby

The strongly religious fear our capacity for moral reasoning that does not require a magical, invisible deity. They fear our ability to be ethical without the threat of hell or the reward of heaven. They fear that our allegiance is not to this or that country, or this or that prophet, or this or that guru, but to humanity as a whole. ~Phil Zuckerman

The idea that God could only forgive our sins by having his son tortured to death as a scapegoat is surely, from an objective point of view, a deeply unpleasant idea. If God wanted to forgive us our sins, why didn’t he just forgive them? Why did he have to have his son tortured? ~Richard Dawkins

Small is beautiful, when small is skilled and dedicated. ~Gene Logsdon

All religions are lies and scams, and all believers are victims. ~David Silverman

We [atheists] have no martyrs, we have no saints. ~Christopher Hitchens

Morality is doing right, no matter what you are told. Religion is doing what you are told, no matter what is right. ~H L Mencken

I've observed that people tend to live at one of two extremes in the spectrum of life: those who live on the edge, and those who avoid the edge. Those who live on the edge are hanging out in the most dangerous and unstable places — yet they're also often the most powerful agents of change, because the edge is where change is happening; away from the edge, things are naturally unchanging. ~Thom Hartmann

Religion. It's given people hope in a world torn apart by religion. ~Jon Stewart

My 12th year was my most Christian and most boring year in my life. ~Chuck Berry

Come on. You just can’t come up with anything more ridiculous than someone who honestly thinks that all human woes stem from an incident in which a talking snake accosted a naked woman in a primeval garden and talked her into eating a piece of fruit. ~Keith Parsons

When men stop believing in God, it isn't that they then believe in nothing: they believe in everything. ~Umberto Eco

Christians don’t need to be born again, they need to grow up. ~John Shelby Spong

Life is not a problem to be solved, nor a question to be answered. Life is a mystery to be experienced. ~Alan Watts

Society is like a stew: If you don't stir it up every now and then, the scum rises to the top.~Edward Abbey

You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete. ~Buckminster Fuller

How thoughtful of God to arrange matters so that, wherever you happen to be born, the local religion always turns out to be the true one. ~ Richard Dawkins

I’m not saying there isn’t a god, but there isn’t a god who cares about people. And who wants a god who doesn’t give a shit? ~Robert Munsch

One of the great tragedies of mankind is that morality has been hijacked by religion. ~Arthur C. Clarke

Give a man a fish, and you'll feed him for a day; Give him a religion, and he'll starve to death
while praying for a fish. ~ Anon

When you understand why you dismiss all the other gods, you will understand why I dismiss yours. ~ Stephen Roberts

Life is without meaning. You bring the meaning to it. The meaning of life is whatever you ascribe it to be. Being alive is the meaning. ~ Joseph Campbell

The only true definition of an atheist: a person who disbelieves or lacks belief in God or gods. ~Oxford English Dictionary

You have good people doing good things and evil people doing evil things. But for good people to do evil things, that takes religion.

Faith is just another word for gullibility.

I sang as one / Who on a tilting deck sings / To keep men's courage up, though the wave hangs / That shall cut off their sun. ~C. Day Lewis

Resilience Tools (Basic)

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The Wikipedia of Christian Terrorism (Link)

Books of the Freethinkers Bible

What is a fact beyond all doubt is that we share an ancestor with every other species of animal and plant on the planet. We know this because some genes are recognizably the same genes in all living creatures, including animals, plants and bacteria. And, above all, the genetic code itself — the dictionary by which all genes are translated — is the same across all living creatures that have ever been looked at. We are all cousins. Your family tree includes not just obvious cousins like chimpanzees and monkeys but also mice, buffaloes, iguanas, wallabies, snails, dandelions, golden eagles, mushrooms, whales, wombats and bacteria. All are our cousins. Every last one of them. Isn't that a far more wonderful thought than any myth? And the most wonderful thing of all is that we know for certain it is literally true...

The whole world is made of incredibly tiny things, much too small to be visible to the naked eye — and yet none of the myths or so-called holy books that some people, even now, think were given to us by an all-knowing god, mentions them at all! In fact, when you look at those myths and stories, you can see that they don't contain any of the knowledge that science has patiently worked out. They don't tell us how big or how old the universe is; they don't tell us how to treat cancer; they don't explain gravity or the internal combustion engine; they don't tell us about germs, or anesthetics. In fact, unsurprisingly, the stories in holy books don't contain any more information about the world than was known to the primitive peoples who first started telling them! If these 'holy books' really were written, or dictated, or inspired, by all-knowing gods, don't you think it's odd that those gods said nothing about any of these important and useful things? -Richard Dawkins

Prayer seems to me a cry of weakness, and an attempt to avoid, by trickery, the rules of the game as laid down. I do not choose to admit weakness. I accept the challenge of responsibility. Life, as it is, does not frighten me, since I have made my peace with the universe as I find it, and bow to its laws… It seems to me that organized creeds are collections of words around a wish. I feel no need for such.

I know that nothing is destructible; things merely change forms. When the consciousness we know as life ceases, I know that I shall still be part and parcel of the world. I was a part before the sun rolled into shape and burst forth in the glory of change. I was, when the earth was hurled out from its fiery rim. I shall return with the earth to Father Sun, and still exist in substance when the sun has lost its fire, and disintegrated into infinity to perhaps become a part of the whirling rubble of space. Why fear? The stuff of my being is matter, ever changing, ever moving, but never lost; so what need of denominations and creeds to deny myself the comfort of all my fellow men? -Zora Neale Hurston

Democratic Socialism

Socialist Alternative is the organization that spearheaded the campaign to elect Kshama Sawant to Seattle City Council, the first independent socialist elected in a major U.S. city in decades. We are a national organization fighting in our workplaces, communities, and campuses against the exploitation and injustices people face every day. We are community activists fighting against budget cuts in public services; we are activists campaigning for a $15/hour minimum wage and fighting, democratic unions; we are people of all colors speaking out against racism and attacks on immigrants, students organizing against tuition hikes and war, women and men fighting sexism and homophobia.

We believe the Republicans and Democrats are both parties of big business, and we are campaigning to build an independent, alternative party of workers and young people to fight for the interests of the millions, not the millionaires.

We see the global capitalist system as the root cause of the economic crisis, poverty, discrimination, war, and environmental destruction. As capitalism moves deeper into crisis, a new generation of workers and youth must join together to take the top 500 corporations into public ownership under democratic control to end the ruling elites’ global competition for profits and power.

We believe the dictatorships that existed in the Soviet Union and Eastern Europe were perversions of what socialism is really about.

We are for democratic socialism where ordinary people will have control over our daily lives.

An atheist believes that a hospital should be built instead of a church. An atheist believes that deed must be done instead of prayer said. An atheist strives for involvement in life and not escape into death. He wants disease conquered, poverty vanished, war eliminated. ~Madalyn Murray O'Hair, Founder

In the history of the world, the number of times a supernatural anything has been proven true is zero. Every god, ghost, spirit, devil, possession, and miracle ever claimed true is a lie. No exceptions. The number of times an atheistic (godless) argument has been proven wrong by a theistic argument is zero... In contrast, every time a theist-versus-atheist argument has been settled, an atheistic argument has won. This does not mean science is antireligion; it just means (or rather, strongly implies) religion is wrong... I challenge anyone to find any scientifically valid testable proof of anything supernatural, ever. If you can prove it, even once, I'll quit my job. I'm not nervous, as it has never been done in history, because it's ALL a lie. ~David Silverman, President

Local Organic Family Farms

THE SMALL ORGANIC FARM greatly discomforts the corporate/ industrial mind because the small organic farm is one of the most relentlessly subversive forces on the planet. Over centuries both the communist and the capitalist systems have tried to destroy small farms because small farmers are a threat to the consolidation of absolute power.

Thomas Jefferson said he didn’t think we could have democracy unless at least 20% of the population was self-supporting on small farms so they were independent enough to be able to tell an oppressive government to stuff it.

It is very difficult to control people who can create products without purchasing inputs from the system, who can market their products directly thus avoiding the involvement of mercenary middlemen, who can butcher animals and preserve foods without reliance on industrial conglomerates, and who can’t be bullied because they can feed their own faces. ~Eliot Coleman